Intel dominates the PC chip market, so ARM is coming at it from all directions - getting its chips into smartphones, tablet computers and Internet connected TVs.

Deep tech circles know about ARM thanks to its smartphone dominance, but it's barely known as a brand to the general public. That only changed when Apple started marketing its A4 chip, but there still seems to be much confusion about what ARM actually does.

So, what does ARM actually do?

ARM is an intellectual property provider, responsible for designing the architecture used in low-power, highly efficient chips that power smartphones, hard drives, and other devices. It describes itself as the R&D department for the entire semiconductor industry. ARM designs chips, licenses those designs, and collects a royalty every time a chip is made using ARM's design.

Think of ARM's employees as a group of talented chefs that only makes recipes. They then sells those recipes to restaurants around the world. Each time a meal is cooked based on an ARM recipe ARM is paid. Continuing the metaphor, when a chef uses an ARM recipe, he can add his own garnishes, appetizers and sides.

That's what Apple did with the A4 chip. It used an ARM design, adding its own custom flare to it. Apple has its A4 chip in the iPhone, and if it revamps Apple TV, ARM designs will be in that, too.

Who are ARM's customers?

Apple isn't alone in choosing ARM designs for its mobile gadgets. ARM's designs are in 1.4 billion chips manufactured each quarter, says Ian Drew, VP of Marketing at ARM. ARM architecture is in 90% of the world's smartphones.

How big is ARM?

While ARM dominates the smartphone market, it's a small company with a market cap of just $6 billion. Profit was $143 million on revenue of $489.5 million last year. By comparison, Intel is a behemoth with a market cap of $117 billion, annual sales of $35 billion, and more than $15 billion in cash on hand.

What will Intel do about ARM?

If Intel wanted, it could probably scoop up ARM Holdings without batting an eye. Of course, there would be regulatory issues, as Intel would have a (bigger) monopoly on computing chips.

Drew says ARM has a different business model than Intel, and he doesn't think Intel could handle working with ARM's 200 partners."The reason we're not Intel, and reason we're not competing with Intel is that we have a different business model," with 200 licensees.

That seems bogus to us. Intel could work it out. It's better for Intel to own the company that's disrupting it and take whatever revenue it can. This is why Quicken bought Mint.com last year.

Regardless, it appears Intel is taking a different tack. It's just going to try and quash ARM by building its own power-efficient chips.

It might be too late. Just like Microsoft is now far behind Google and Apple in the mobile world, Intel too, is far behind. As Om Malik at GigaOm recently noted, "To put it bluntly, it won't be until next year that Intel will have a competitive offering on the market — an eternity in the mobile world."